Delhi High Court
Esab India Limited vs Special Diriector Of Enforcement & Anr. on 8 March, 2011
Author: Dipak Misra
Bench: Chief Justice, Sanjiv Khanna
2.
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 8th March, 2011
+ WRIT PETITION (CIVIL) NO. 1138/2010
ESAB INDIA LIMITED ..... Petitioner
Through Mr. Mathews J. Nedumpara, Mr.
Robin Majumdar & Mr. K. Lingaraja,
Advocates.
versus
SPECIAL DIRIECTOR OF ENFORCEMENT & ANR.
..... Respondents
Through Mr. Sachin Datta, Standing
Counsel for UOI.
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE SANJIV KHANNA
1. Whether Reporters of local papers may be allowed to see the judgment? Yes.
2. To be referred to the Reporter or not ? Yes.
3. Whether the judgment should be reported in the Digest ? Yes.
DIPAK MISRA, CJ.
Before we proceed to state the facts, we may profitably
refer to a paragraph from the decision rendered in the case of
R.S. Joshi, Sales Tax Officer, Gujarat and others versus Ajit
Mills Ltd. and another, (1977) 4 SCC 98, wherein Krishna Iyer,
J., in his inimitable style expressed thus:-
"2. A prefactory caveat.- When
examining a legislation from the angle of
WRIT PETITION (CIVIL) NO. 1138/2010 Page 1 of 23
its vires, the Court has to be resilient,
not rigid, forward-looking, not static,
liberal, not verbal in interpreting the
organic law of the nation. We must also
remember the constitutional proposition
enunciated by the U.S. Supreme Court
in Munn Vs. Illinois viz, „that Courts do
not substitute their social and economic
beliefs for the judgment of legislative
bodies‟. Moreover, while trespasses will
not be forgiven, a presumption of
constitutionality must colour judicial
construction. These factors, recognized
our Court, are essential to the modus
vivendi between the judicial and
legislative branches of the State, both
working beneath the canopy of the
Constitution."
2. That apart, in the case of Charanjit Lal Chowdhary
versus Union of India, AIR 1951 SC 41, it has been held thus:
"It is the accepted doctrine of American
Courts, which I consider to be well
founded on principle, that the
presumption is always in favour of the
constitutionality of an enactment, and
the burden is upon him who attacks it to
show that there has been a clear
transgression of the constitutional
principles."
3. In Ram Krishna Dalmia and Others versus Justice S.R.
Tendolkar and Others, AIR 1958 SC 538, the Apex Court ruled
that there is always a presumption in favour of the
constitutionality of an enactment and the burden is on him who
challenges the same to show that there has been a clear
WRIT PETITION (CIVIL) NO. 1138/2010 Page 2 of 23
transgression of the constitutional principles and it is the duty of
the Court to sustain that there is a presumption of
constitutionality and in doing so, the Court may take into
consideration, the matters of common knowledge, matters of
common report, the history of the times and may assume every
state of facts which can be conceived existing at the time of
legislation.
4. In State of Bihar and Others versus Bihar Distillery
Limited, AIR 1997 SC 1511, the said principle was reiterated.
5. We have referred to the aforesaid authorities for the
sanguine and sacrosanct reason as in this writ petition the
petitioner, Esab India Limited, invoking the extraordinary
jurisdiction of this Court under Article 226 of the Constitution of
India, has prayed for declaring Section 24 read with Second
Schedule of the Right to Information Act, 2005 (for brevity, „the
Act‟) as unconstitutional and also for issuing a writ of certiorari
for quashment of the order dated 11th May, 2009, Annexure-P7,
passed by the Central Information Commission. We are
disposed to think that the seemly cogitation is to be done in the
backdrop of the „caveat‟. The modus vivendi which requires a
purposive and constructive ratiocination while engaged in
WRIT PETITION (CIVIL) NO. 1138/2010 Page 3 of 23
viceration of the provision, a legislative one, though may draw
strength and stimulus in all its variation from the greatest
instrument, i.e., the Constitution, in a given case and in a
particular factual situation if the provisions trespass the
quintessential characteristic of Organic Law or Judge made law
should not be allowed to stand.
6. Presently to the factual matrix: The essential facts which
are imperative to be unfurled are that the petitioner, a limited
company, is engaged in the business of welding equipments,
building infrastructure, etc. On 15th April, 2008, a notice was
issued to the petitioner demanding a sum of Rs.6,79,28,975/-
pursuant to a recovery certificate issued by the Special Director
of Enforcement Directorate, the first respondent herein. After
receipt of the said demand notice, the petitioner came to know
that an adjudication order dated 24th February, 2004 imposing
the penalty has been passed under Section 8(3) and 8(4) of the
Foreign Exchange Regulation Act, 1973 (for short, „FERA‟).
After coming to know about the ex parte adjudication order, the
petitioner preferred an appeal before the Appellate Tribunal for
Foreign Exchange and also preferred a writ petition in the High
Court of Bombay. The Appellate Tribunal rejected the appeal on
WRIT PETITION (CIVIL) NO. 1138/2010 Page 4 of 23
the foundation that it has no power to condone the delay regard
being had to the statutory provisions incorporated under FERA.
The High Court of Bombay allowed the writ petition and set
aside the entire adjudication proceedings and directed the
Enforcement Directorate to conduct a fresh adjudication.
7. It is asserted in the petition that the authorities under
FERA have issued the show cause notice, which is a laconic
one. The petitioner by letter dated 21st April, 2008 asked for
basic materials and allegations based on which a show cause
notice was issued. As the said letter was not responded to by
the Enforcement Directorate, the petitioner preferred an
application under the Act requiring answer to 14 queries. The
said application was not entertained on the ground that the
requisite information could not be provided by the Directorate of
Enforcement as the Directorate has been exempted under
Section 24 read with Second Schedule of the Act.
8. Being aggrieved by the aforesaid order, the petitioner
preferred a first appeal before the Directorate of Enforcement,
which concurred with the order passed by the Public Information
Officer.
9. Being dissatisfied with the aforesaid order, a further
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appeal was filed before the Central Information Commission and
by the impugned order dated 11th May, 2009 the Information
Commission dismissed the same on the following grounds:-
"7. Appellant‟s arguments lacked
merit. It is not for this commission to
pronounce on the constitutionality of
Section 24 of the RTI Act, no is it
required that this Commission goes
behind the provisions in Section 24 to
examine whether in a given case, the
claim of exemption by a public authority
was at-all valid. Section 24 of the RTI
Act is a self-contained Section with a
provision which spells out the conditions
under which disclosure can be allowed
in spite of the exemption enjoyed by a
public authority under that Section.
Matter is not about the „fundamental
rights versus the exemption provision of
the RTI Act‟- scenario painted by the
appellant‟s Counsel.
8. In the present case, nothing which
has been stated would show that the
exception to the exemption rule
contained in Section 24 of the RTI Act is
attracted. In other words, there is no
case of human rights violation or
corruption that needed to be examined
for a decision in this matter."
10. As has been stated earlier, apart from challenging the said
order, the validity of Section 24 read with Second Schedule to
the Act has been assailed on the ground that right to information
is a fundamental right and it has to be treated with sanctity and
WRIT PETITION (CIVIL) NO. 1138/2010 Page 6 of 23
the bar created under the Act is contrary to Article 19(1)(a) of the
Constitution of India. That apart, it is urged that the said
provision is totally arbitrary and without any guidance and
hence, is also hit by Article 14 of the Constitution.
11. A counter affidavit has been filed contending, inter alia,
that the petitioner has no locus standi, being a body corporate to
ask for any information under the Act and in the absence of any
locus, the validity of the provision need not be addressed to. It
is also put forth that the orders passed by the authorities below
are in accord with the provisions of the Act and, therefore, the
challenge on that score in untenable. As far as the validity of the
Act is concerned, it is urged that the Section 24 of the Act is a
complete Code and it does not violate either Article 14 or
19(1)(a) of the Constitution.
12. We have heard Mr. Mathews J. Nedumpara, learned
counsel for the petitioner and Mr. Sachin Datta, learned counsel
for the Union of India.
13. Learned counsel for the petitioner has raised the following
contentions:
(a) Right to information is a fundamental and a primary
right in a democratic body polity which respects
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transparency, freedom of access to information and
is protected under Article 19(1)(a) of the Constitution
of India and, therefore, the same cannot be infringed
or abridged by a statutory provision.
(b) The exceptions that have been carved out under
Section 24 of the Act suffer from lack of guidance
and, therefore, an unfettered and unbridled power is
conferred on the statutory authority inasmuch the
authority in the name of security or any other facet
can deny the information to a citizen which is
violation of the basic tenet of Article 14 of the
Constitution. That apart, the provision is arbitrary
and unreasonable.
(c) The right to information is a basic human right and
has to be progressive but by incorporating Section
24 in the Act, the said basic human right is
absolutely smothered and consequent of which the
growth of democracy is scuttled which affects the
basic structure of the Constitution.
14. Learned counsel to bolster the said submissions has
commended us to the decisions in S.P. Gupta versus Union of
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India, AIR 1982 SC 149, State of U.P. versus Raj Narain,
(1975) 4 SCC 428, Indian Express versus Union of India, AIR
1985 SC 641, Reliance Petrochemicals Limited versus
Proprietors of Indian Express Newspapers, Bombay Private
Limited and Others, (1988) 4 SCC 592, PUCL versus Union
of India, AIR 2004 SC 1442, Union of India versus
Association for Democratic Rights, (2002) 5 SCC 294.
15. Mr. Datta, per contra, has submitted that if the objects and
reasons of the Act are appreciated in proper perspective, the
purpose is to furnish certain information under the Act and what
has been denied under Section 24, relates to the intelligence
and security organizations and the names of organizations have
been mentioned in the Second Schedule of the Act. Learned
counsel for the Union of India would further submit that the
petitioner may approach the authorities under the FERA for
relevant documents within permissible parameters while
challenging the order but that would not entitle him to challenge
the validity of the Act. It is also contended by him the provision
does not invite the frown of either Article 14 or 19(1)(a) of the
Act.
16. It is apt to note the Act was enacted to harmonize the
WRIT PETITION (CIVIL) NO. 1138/2010 Page 9 of 23
conflicting interest while preserving the paramountancy of the
democratic ideals and to provide for furnishing certain
information to the citizens who desire to have it. The basic
purpose of the Act is to provide for setting up the practical
regime of right to information for citizens to secure and to have
access to information under the control of public authorities in
order to promote transparency and accountability in the working
of every public authority.
17. Section 24 occurs in Chapter VI of the Act, which is under
the miscellaneous heading. Section 24 of the Act provides for
the Act not to apply certain organizations. As the said provision
is under assail, we think it apposite to reproduce the same in
entirety:
"24. Act not to apply in certain
organizations.-(1) Nothing contained in
this Act shall apply to the intelligence and
security organisations specified in the
Second Schedule, being organisations
established by the Central Government
or any information furnished by such
organisations to that Government:
Provided that the information pertaining
to the allegations of corruption and
human rights violations shall not be
excluded under this sub-section:
Provided further that in the case of
information sought for is in respect of
allegations of violation of human rights,
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the information shall only be provided
after the approval of the Central
Information Commission, and
notwithstanding anything contained in
section 7, such information shall be
provided within forty-five days from the
date of the receipt of request.
(2) The Central Government may, by
notification in the Official Gazette, amend
the Schedule by including therein any
other intelligence or security organisation
established by that Government or
omitting therefrom any organisation
already specified therein and on the
publication of such notification, such
organisation shall be deemed to be
included in or, as the case may be,
omitted from the Schedule.
(3) Every notification issued under sub-
section (2) shall be laid before each
House of Parliament.
(4) Nothing contained in this Act shall
apply to such intelligence and security
organisation being organisations
established by the State Government, as
that Government may, from time to time,
by notification in the Official Gazette,
specify:
Provided that the information pertaining
to the allegations of corruption and
human rights violations shall not be
excluded under this sub-section:
Provided further that in the case of
information sought for is in respect of
allegations of violation of human rights,
the information shall only be provided
after the approval of the State
Information Commission and,
notwithstanding anything contained in
section 7, such information shall be
WRIT PETITION (CIVIL) NO. 1138/2010 Page 11 of 23
provided within forty-five days from the
date of the receipt of request.
(5) Every notification issued under sub-
section (4) shall be laid before the State
Legislature."
18. Apart from the said provision, what is also under challenge
is the Second Schedule to the Act. The Second Schedule
includes the intelligence and security organizations established
by the Central Government, which reads as follows:-
"THE SECOND SCHEDULE
(See section 24)
Intelligence and security organisation
established by the Central
Government
1. Intelligence Bureau.
2. Research and Analysis Wing of the
Cabinet Secretariat.
3. Directorate of Revenue Intelligence.
4. Central Economic Intelligence
Bureau.
5. Directorate of Enforcement.
6. Narcotics Control Bureau.
7. Aviation Research Centre.
8. Special Frontier Force.
9. Border Security Force.
10. Central Reserve Police Force.
11. Indo-Tibetan Border Police.
12. Central Industrial Security Force.
13. National Security Guards.
14. Assam Rifles.
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15. Special Service Bureau
16. Special Branch (CID), Andaman and
Nicobar.
17. The Crime Branch-C.I.D.-CB, Dadra
and Nagar Haveli.
18. Special Branch, Lakshadweep
Police."
19. Regard being had to the basic principles, which we have
stated at the very inception, it is to be seen whether the
provision under attack really offends the constitutional principles
because of right to seek information under the Act in respect of
certain institutions is excluded. Learned counsel for the
petitioner has drawn immense inspiration from the view
expressed in the case of Raj Narain (supra), wherein Mathew J.
has held thus:
"71. Few would question the
necessity of the rule to exclude that
which would cause serious prejudice to
the State. When a question of national
security is involved, the Court may not
be the proper forum to weigh the matter
and that is the reason why a minister‟s
certificate is taken as conclusive. "Those
who are responsible for the national
security must be the sole judges of what
national security requires." As the
Executive is solely responsible for
national security including foreign
relations, no other organ could judge so
well of such matters. Therefore,
documents in relation to these matters
might fall into a class which per se might
require protection. But the Executive is
not the organ solely responsible for
WRIT PETITION (CIVIL) NO. 1138/2010 Page 13 of 23
public interest. It represents only an
important element in it; but there are
other elements. One such element is the
administration of justice. The claim of
the Executive to have exclusive and
conclusive power to determine what is in
public interest is a claim based on the
assumption that the Executive alone
knows what is best for the citizen. The
claim of the Executive to exclude
evidence is more likely to operate to
subserve a partial interest, viewed
exclusively from a narrow department
angle. It is impossible for it to see or
give equal weight to another matter,
namely, that justice should be done and
seen to be done. When there are more
aspects of public interest to be
considered, the Court will, with
reference to the pending litigation, be in
a better position to decide where the
weight of public interest predominates.
72. The power reserved to the Court
is a power to order production even
though public interest is to some extent
prejudicially affected. This amounts to a
recognition that more than one aspect of
public interest will have to be surveyed.
The interests of Government for which
the minister speaks do not exhaust the
whole public interest. Another aspect of
that interest is seen in the need for
impartial administration of justice. It
seems reasonable to assume that a
court is better qualified than the minister
to measure the importance of the public
interest in the case before it. The court
has to make an assessment of the
relative claims of these different aspects
of public interest. While there are
overwhelming arguments for giving to
the Executive the power to determine
what matters may prejudice public
security, those arguments give no
sanction to giving the executive an
exclusive power to determine what
matters may affect public interest. Once
considerations of national security are
WRIT PETITION (CIVIL) NO. 1138/2010 Page 14 of 23
left out, there are few matters of public
interest which cannot safely be
discussed in public. The administration
itself knows of many classes of security
documents ranging from those merely
reserved for official use to those which
can be seen only by a handful of
ministers or officials bound by oath of
secrecy.
73. According to Wigmore, the extent
to which this privilege has gone beyond
"secrets of State" in the military or
international sense is by no means
clearly defined and therefore its scope
and bearing are open to careful
examination in the light of logic and
policy. According to him, in a community
under a system of representative
Government, there can be only few facts
which require to be kept secret with that
solidity which defies even the inquiry of
courts of justice.
74. In a Government of responsibility
like ours, where all the agents of the
public must be responsible for their
conduct, there can be but few secrets.
The people of this country have a right
to know every public act, everything that
is done in a public way, by their public
functionaries. They are entitled to know
the particulars of every public
transaction in all its bearing. The right to
know, which is derived from the concept
of freedom of speech, though not
absolute, is a factor which should make
one wary, when secrecy is claimed for
transactions which can, at any rate,
have no repercussion on public security.
To cover with veil of secrecy, the
common routine business, is not in the
interest of the public. Such secrecy can
seldom be legitimately desired. It is
generally desired for the purpose of
parties and politics or personal self-
interest or bureaucratic routine."
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20. In paragraph 71, it has been recognized that there is a
necessity to exclude from right to access information, matters
which could cause serious prejudice to the State like national
security. It has been observed therein that documents in
relation to these matters might fall in a class which per se
require protection and, therefore, form a separate class.
However, word of caution has been sounded and an opinion has
been expressed that the Executive is not solely responsible for
public interest though they represent an important element in it.
The Court, in a given case and when a situation warrants, can
weigh which public interest predominates. In a particular case
when a larger public interest warrants access to certain
information, objection of the Executive can be overruled. In the
present case, we are not concerned with the power of Court to
decide Executive‟s claim for privilege viz. a particular public
interest. This is not the subject matter in issue before us. The
Act does not curtail or do away with the powers of the court and
the petitioner‟s right to approach the court in accordance with
law, if the situation warrants. The Act, on the other hand,
provides machinery for easy, inexpensive and fast access to
information, which should not be per se denied to the citizens of
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the country. The observations in the case of Raj Narain (supra)
show that the Apex Court had made a clear distinction between
the matters of national security and other matters. Although the
right of the Executive at the first instance to decide what
constitutes "secrets of State" and the matters of national security
has been accepted and recognized in the aforesaid passages,
however, it is stated that the power of the Court to decide and
weigh public interest is sacrosanct and not curtailed. Read on
the said touchstone, the Act does not curtail and does not
subjugate right to information, but ensures easy and transparent
access to information in all public matters, which ex-facie are not
concerned with national security or intelligence agencies of the
State. As noticed below, Article 19(2) of the Constitution also
carves out exception in the matters relating to interests of
sovereignty and integrity of India and the security of the State.
The distinction between the two sets of information has been
recognized and accepted in the aforesaid paragraphs in the
case of Raj Narain (supra).
21. In paragraph 72 of the said decision, it has been ruled that
the court has to make an assessment of the relative influence of
different aspects of public interest. The interest of Government
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for which the Minister speaks does not exhaust the whole public
interest. In paragraph 74 what has been stated is worthy of
reproduction and we have done so. Thus, it can be stated with
certitude that a distinction has been drawn with regard to
common routine business and the security factor.
22. In Reliance Petrochemicals Limited (supra) it has been
opined thus:-
"34. ........Right to know is a basic right
which citizens of a free country aspire in
the broader horizon of the right to live in
this age in our land under Article 21 of
our Constitution. That right has reached
new dimensions and urgency. That
right puts greater responsibility upon
those who take upon themselves the
responsibility to inform."
23. At this juncture, we may think it appropriate to reproduce
Article 19(1) and (2) of the Constitution of India.
""19. (1) All citizens shall have the
right--
(a) to freedom of speech and expression;
(b) to assemble peaceably and without
arms;
(c) to form associations or unions;
(d) to move freely throughout the territory
of India;
(e) to reside and settle in any part of the
territory
WRIT PETITION (CIVIL) NO. 1138/2010 Page 18 of 23
of India; 1[and]
2* * * * *
(g) to practise any profession, or to carry
on any occupation, trade or business.
(2) Nothing in sub-clause (a) of clause
(1) shall affect the operation of any
existing law, or prevent the State from
making any law, in so far as such law
imposes reasonable restrictions on the
exercise of the right conferred by the said
sub-clause in the interests of the
sovereignty and integrity of India, the
security of the State, friendly relations
with foreign States, public order, decency
or morality, or in relation to contempt of
court, defamation or incitement to an
offence."
24. On a perusal of Article 19, it is clear that every citizen shall
have a right to freedom of speech and expression, but the same
is not absolute and the State while making law can impose
reasonable restrictions on the exercise of the rights conferred by
the State under sub-clause (a) of clause 1 in the interest of the
sovereignty and integrity of India, the security of the State,
friendly relations with foreign States, public order, decency or
morality, or in relation to contempt of court, defamation or
incitement to an offence.
25. In the case of People's Union for Civil Liberties versus
Union of India, (2004) 2 SCC 476, while treating the right to the
human right or a fundamental right and a right in the public
WRIT PETITION (CIVIL) NO. 1138/2010 Page 19 of 23
interest, the court opined thus:-
"64. It has not been contended nor
could it be contended that the operation
and functioning of a nuclear plant is not
sensitive in nature. Any information
relating to the training features,
processes or technology cannot be
disclosed as it may be vulnerable to
sabotage. As rightly pointed out by the
learned Attorney General, knowledge of
specific data may enable the enemies of
the nation to estimate and monitor
strategic activities. As fissile materials
are used in fuels although the nuclear
plants are engaged in commercial
activities, the contents of the fuel
discharged or any other details must be
held to be matters of sensitive
character.
65. Before the High Court, as noticed
hereinbefore, several affidavits have
been filed showing the extent of
disclosures made. The Board also
publishes annual reports as also
quarterly newsletters. The informations
which are not classified as "secret" or do
not come within the purview of the
aforementioned order dated 4-2-1975
are published. If a reasonable restriction
is imposed in the interest of the State by
reason of a valid piece of legislation, the
court normally would respect the
legislative policy behind the same."
26. A reasonable restriction on the exercise of the right is
always permissible in the interest of the security of the State.
Thus, in the aforesaid decision the concept of reasonable
restriction as well as the functioning of a nuclear plant and its
sensitivity, were taken into consideration.
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27. In the case at hand, as far as Section 24 is concerned, it is
evincible that the said provision excludes the intelligence and
security organizations specified in the Second Schedule. We
have already reproduced the Second Schedule. The petitioner
is concerned with the Directorate of Enforcement which comes
at serial No. 5 in the Second Scheule. What has been denied in
first part of Section 24 is the intelligence and security
organizations. The first proviso adds a rider by stating that an
information pertaining to allegations of corruption and human
right violations shall not be excluded under the sub-section.
Thus, it is understood that information relating to corruption and
information pertaining to human rights are not protected. In our
considered opinion, the restriction on security and intelligence
aspect cannot be scuttled as the same has paramountancy as
far as the sovereignty and economic order is concerned. Article
19(1)(2), which deals with reasonable restriction, mentions a
reasonable restriction which pertains to security of the State,
integrity of India and public order.
28. In our considered opinion, the restrictions imposed are
absolutely reasonable and in the name of right to freedom of
speech and expression and right to information, the same
WRIT PETITION (CIVIL) NO. 1138/2010 Page 21 of 23
cannot be claimed as a matter of absolute right. Thus, the
submissions advanced on this score are untenable and
accordingly we repel the same.
29. The next ground of attack is that the said provision suffers
from arbitrariness, there being no guidance. On a perusal of
Section 24 in a studied manner, we find that there is guidance
inasmuch as two organizations, namely, security and
intelligence, have been included, and apart from the above, we
really fail to fathom how the said provision is arbitrary or without
any guidance when the basic intrinsic purpose in respect of an
individual and the nation, viz., the human right violation and
corruption are not excluded. Therefore, the legislature has
taken care to see that matters relating to human right violation
and corruption are not excluded because they are of paramount
concern to any citizen and for the economic growth of the
country. The same, we are disposed to think has stemmed from
the neat logic of proper governance. Thus, we perceive that the
provision is not arbitrary and unreasonable to invite the wrath of
Article 14 of the Constitution of India.
30. In the result, we do not find any merit in this writ petition
and accordingly the same stands dismissed without any order as
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to costs.
CHIEF JUSTICE
SANJIV KHANNA, J.
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